How New York’s Unequal Economy Mirrors The National One

September 18, 2013

One of the most-discussed articles on the Internet over the past few days—I don’t mean that disparagingly, the Internet is where we have discussions now!—was Peter Beinart’s essay arguing that Bill de Blasio’s decisive victory in New York’s Democratic mayoral primary is presaging a fundamental generational shift, prompted both by Millennial sensibilities and increased inequality, toward a more left-liberal politics among Democrats. “The deeper you look,” he wrote, “the stronger the evidence that de Blasio’s victory is an omen of what may become the defining story of America’s next political era: the challenge, to both parties, from the left.” He added that “the subject of economic inequality and corporate power” has particular “resonance.”

There was apparently an easy criticism to make. “I’ll dispatch with what is easily the weakest part of Beinart’s analysis,” wrote Kathleen Geier at the (liberal) Washington Monthly. “de Blasio’s victory is a weak peg to hang his argument on,” she continues. “It’s just one election, de Blasio hasn’t even taken office (the general election hasn’t taken place yet), and he actually earned a slightly higher share of votes from voters age 45 and up than from those under 30.” Even if Beinart (who used to edit this magazine) is right about the general trend-lines, how fair is it to extrapolate to the entire country from a vote held by several hundred thousand members of a notably liberal city in a partisan primary? (In the first post-primary poll, released Tuesday evening, de Blasio led Republican nominee Joe Lhota by a commanding 65-22.) In what sense can New York, never mind New York liberals, be said to speak for America?

Not totally. But more, I believe, than most think. A front-page story in The New York Times reports, shamefully, that in New York, 28 percent of homeless families include at least one employed adult, and fully “16 percent of single adults in shelters hold jobs.” These adults are mostly female. Through no fault of their own (almost by definition, since they have jobs), they represent a blemish on the American social contract.

(I can’t help but quote President Bill Clinton—whose wife, Hillary Clinton, Beinart believes may run into trouble from a Democratic Party newly driven by inequality concerns. “We can give all our people a chance to move from welfare to work, to transform our broken welfare system once and for all,” he said while running for re-election in July 1996. Presumably, an un-broken welfare system would not have this many homeless employed people. A month later, Clinton signed welfare reform, declaring, “Today, we are ending welfare as we know it.”)

A local problem, right? To some extent, sure. In New York, rents continued to rise throughout the recession and its aftermath, even as housing prices fell (which is partly why a progressive like de Blasio is also pro-development). The costs of housing and, relatedly, of living in New York are much higher than those of the rest of the country. That is obviously relevant here, since we are talking about people literally being unable to find homes.

But actually, it is kind of like this everywhere. John Cassidy, who writes for The New Yorker but does not write mainly about New York, noted earlier this week, “The Great Recession and its aftermath have accentuated the long-term trend of rising inequality. After the rich saw their incomes take a hit in 2007 and 2008, when the stock market fell, their share of overall income has rebounded to pre-recession levels. In 2012, the top ten percent of earners received about fifty per cent of all the income that the economy generated, and the top one percent received 22.5 percent.” While total after-tax corporate profits have jumped 50 percent since the Great Recession and while the stock market has zoomed, median household income has not reached its pre-recession level. In fact, adjusted for inflation, Cassidy added Tuesday while relying on new U.S. Census data, the typical household has seen its annual income grow just $3500 since 1973; at the 95th percentile, income grew nearly 50 percent. He was not describing the five boroughs, but the 50 states.

When I wrote about de Blasio in August, I noted all the ways in which New York was sui generis—not merely our mild billionaire mayor, but the astounding inequality as well as the sense, confirmed by a Times study, that vast majorities of all income groups believe the city “is becoming too expensive.” But that national themes were unavoidable. Urban geographer Joel Kotkin described New York to me as a place where national trends were not absent, but merely exaggerated. “There’s got to be the incredible contrast of wealth and poverty—certainly true in the country, more true in New York,” he said. “New York,” he added, “by its very nature, sets the tone for a class that exists nationwide.” He added: “If you want to talk about the rich getting richer, New York is a perfect example of that.” Not an aberration. Just a perfect example.

The Times’s Mireya Navarro talked to a New York native who works two jobs as a security guard and has lived in a homeless shelter for three years. “New York City,” she told him, “is the hardest city to live in.” This is probably true. But New York is hard in the same way that the rest of the country is hard.